How to create your own profitable milk processing business
Residents of rural areas now very rarely keep dairy cattle, and there is often a queue to the owners of cows or goats for an organic product.
But if there is demand, why not offer more? Why not use home milk processing as a business idea?
Benefits of the dairy business
It has become profitable to process milk, because dairy producers receive the following benefits:
- subsidies from the budget;
- exemption from district and regional tax payments;
- deferral of basic taxes.
These benefits allow many entrepreneurs to start their own small profitable business.
What you need to open
Like any business, the processing of dairy products requires legal registration of the business and investment of funds.
Legally, at the initial stage, you will need to draw up the following documents:
- Certificate of private entrepreneurship.
- Permission for retail sale of milk-based products (at first, this may be a small kiosk in front of the house or sale from a car in the agricultural market).
- Veterinary certificate of the established form for dairy animals, if you plan to produce goat or cow milk yourself.
- Certificate confirming the sanitary standards of the premises for breeding cows for the supply of raw materials for processing.
It is often difficult for any novice businessman to find an industry in which he can confidently invest his existing capital. In recent years, the opening of a mini-milk processing plant, which can bring considerable income, is considered a very promising business. In our article, you can learn in more detail how to organize such a business, what nuances should be taken into account, and also which sequence of actions to follow.
If you decide to organize your own mini-milk processing plant, then first of all you should officially register yourself as a legal entity or individual. This condition is due to the fact that future stages, which are aimed at renting or acquiring premises, as well as concluding contracts for the shipment of finished goods and the supply of raw materials, will be made on your behalf.
The sequence of steps required to open a mini milk processing plant is as follows:
- Submitting a relevant application to the tax office to register yourself as a legal entity or individual. In addition to the application, you should also provide a photocopy of your passport, identification code, as well as a receipt for payment of state duty.
- When you are given a government-issued certificate, you need to register immediately. This procedure can also be carried out at the tax office. After that, you should receive a certificate stating that you are a full-fledged tax payer.
To open your own mini-milk processing plant, after registering your activity, you should receive the relevant documents that will allow you to legally carry out this business. These documents include the following:
- Trade Permit.
- Permission to sell the produced dairy product.
- Veterinary certificate for finished products.
- Quality certificate.
- Conclusion of the fire inspection, sanitary and epidemiological station on the compliance of your equipment and premises with the requirements that apply to food processing enterprises.
At first glance, it might seem that mini dairy processing plants can produce only a limited range of products, unable to satisfy the preferences of a large number of consumers. But this statement is not considered valid. Currently, there are so-called modular mini dairies, as well as special technological lines of compact size, which are able to provide the ability to produce the following product range:
- Pasteurized milk.
- Standardized milk.
- Curd mass and curd of different fat content.
- Sour cream products and sour cream.
Few food products are as popular as milk. On its basis, many products are produced: from delicate desserts to hard cheeses of long aging.
Since there are so many consumers of dairy products, their production is relevant and profitable at any time of the year. The main thing in starting a milk business is the right investment, patience and hard work.
Dairy production launch
First of all, the dairy business needs to be registered. A small village enterprise can successfully function as an individual entrepreneur.
Then you should acquire a farm, dairy cows and arrange the supply of dairy products to the points of sale - small rural or regional markets.
Fresh milk has a fairly short shelf life. If the starting budget of the dairy business does not involve opening your own point of sale, the best option would be to buy a small milk processing complex and a separator. All of this should reflect your milk production business plan.
Average daily milk yield from 5 cows can be up to 100 liters. If at the first stage of production this volume cannot be realized, a certain part of it can be left for oxidation for such products as cottage cheese, cheese and sour cream.
With a separator, it is possible to produce cream. It should be remembered that the demand for such dairy products is in no way inferior to the demand for milk itself, so you can safely take on its processing.
Profitability of maintaining a medium-sized dairy business
Expanding the milk production business will require an approximate investment of about 1.2 million rubles, which will go to:
- Construction of production areas;
- Supply of electricity, water supply and sewerage;
- Preparation of areas;
- Organization of cooling systems;
- Purchase of a modular plant;
- Delivery and installation of equipment;
- Purchase of raw materials and consumables;
- Salaries of employees.
Medium-scale dairy production with a three-shift work schedule is capable of producing up to 2,000 liters of products per day, which, with an average cost of 1 liter of milk - 30 rubles, can generate income of 1,800,000 rubles. monthly.
Subtracting from this amount the monthly expenses for utility bills, taxes, freight, wages and the purchase of raw materials, you will get a profit of about 700,000 rubles. - so much can be earned with a balanced approach.
Few of us decide to open our own production, especially when it comes to perishable products. Reconomica spoke to a businessman who decided to open a dairy production in the Rostov region. It is interesting that the impetus for the business idea was given by the Russian Federation's sanctions against foreign food products. The author asked not to indicate his brand, but otherwise, aspiring entrepreneurs can get a lot of interesting information about the organization of production, problems and common mistakes. And the most important and visual are the figures for profitability, productivity and profits.
Choosing a niche for production
My name is Evgeny Smirnovsky, an economist by education. After a long unsuccessful job search, my comrades and I came to the conclusion that we should try to start working “for ourselves”. It was 2021, the country came under sanctions and an import substitution policy was announced. Having discussed all possible options, we, as future partners, opted for the organization of food production, namely, we chose the production of milk and dairy products.
Long pasteurization bath for 300 liters.
The following arguments pushed us to this conclusion:
- These goods are essential goods and therefore will always be in demand on the market;
- the proximity of the regional center, a large city in the south of our country, which facilitated the search for sales markets products;
- the presence of the environment of the future companions of the owner of the peasant farm, which solved the issues of providing the future enterprise with raw materials;
- state support in the form of various subsidies;
- import substitution policy , which gave the chance to simplify the process of entering the market.
Purchase of a dairy plant
Having analyzed the available options for organizing a new production, having previously agreed with trade organizations, we decided to buy a ready-made modular workshop for the production of dairy products. The choice was made in favor of a domestic equipment manufacturer.
The cost of a modular workshop with a capacity of 4 tons of finished products per day was 15,000,000 rubles. Workshop area - 110 sq. ...
In the district administration, we learned that there are free land plots that can be rented, completed all the necessary documents and received a plot of 50 acres. The rent is 26,000 rubles per year.
This is how our modular workshop looks like.
When choosing a site, we took into account the distance from the peasant farm, it turned out to be the minimum - 5 kilometers. The choice was made correctly, because there was no need to purchase a specialized thermos milk tanker. It is easier to deliver finished packaged products over long distances than raw milk, especially since we purchased a fleet of cars with refrigeration equipment for delivery to trade organizations.
Setting up your own business for the production of milk and dairy products. Today we will tell you in detail about high-quality equipment, all the intricacies of the production process, how to feed animals to obtain environmentally friendly milk and the legal nuances of starting a business.
In the process of technological evolution, the whole scheme of obtaining and processing milk was radically revised. Now it is no longer a specially trained person milking a cow in order to obtain useful raw materials, but programmed technologies carry out the milking process of milk and dairy products production.
Therefore, an organized center that promotes the rapid processing of milk automates the production process, reducing not only the time for obtaining the final product, but also allows you to reduce costs and increase the profitability of the business process.
To launch a milk processing plant with a capacity of 2,000 liters per day, the following investments will be required:
- workshop with equipment - 5,500,000 rubles;
- laboratory - 800,000 rubles;
- warehouse for storing milk (raw materials) - 700,000 rubles;
- utility room - 650,000 rubles;
- warehouse for storing finished products - 850,000 rubles.
Total: 8,500,000 rubles of one-time investments.
Expenses for monthly wages, fuel and utility rates, advertising policy, taxes are approximately 550,000 rubles.
An entrepreneur should take into account such factors as sanitary standards, which the building must necessarily comply with, coordination of activities at the official level with the administration, fire safety department and Rospotrebnadzor.
What will be profitable to produce:
- pasteurized milk of various fat content;
- kefir, fermented baked milk, drinking yogurt;
- cottage cheese by weight and in packaging;
- hard cheeses;
- sour cream in soft packaging and plastic cups;